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New Contractor saves 17% Tax!

Making contracting easy and delivering peace of mind

Our Client

Newly self employed and wanting to venture into the world of IT contracting for the first time, we were approached by our client to explore the best way to set himself up in business.

The Problem

The options available can be fairly complex, especially to someone coming from an employed background, and most readily available information is either full of jargon, or biased to that provider’s preferred solution, rather than focussing on the individual’s personal situation.

Out client had attained a 12 month contract worth £70,000 per annum, and was confused about which route to take – limited company / sole trader / umbrella organisation – as at the end of this contract he was unsure whether he would be more likely to stay contracting or take up a permanent position.

Our Solution

We were able to explain clearly the differences and impact of all available options to our client before he made his decision, and advised him that the best, and most financially beneficial, route for him personally was to set up as and operate through a limited company.

We then set up and registered the company with all relevant parties and taxes so our client could start trading immediately. We implemented a pro-active remuneration strategy that ensured that he paid less than half the tax and costs he would have incurred in another route.

We then advised him of key dates (which can now all be found on our TaxApp, downloadable HERE), implications of IR35 and other legislation, and how to best operate as a director.

The Result

9 months on and our client has never looked back. He is delighted that he is taking home 85% of his gross pay, in comparison with the 68% he would have taken had he not taken our advice and gone down an alternative route to being self employed.

He is looking at ways to develop his company for the long-term and attain further contracts of business and believes that if he had known how easy the limited company was he would have done this years ago.

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Have you ever considered selling on Amazon or eBay, setting up an eCommerce business, or a little side hustle?

If this sounds like you, it seems you are not alone.

More and more people these days are selling online to boost their income, sometimes just for a bit of fun and with no higher plans, and other times in the hopes of turning this so called side hustle into their dream job and their very first foray into entrepreneurship…

We have been receiving lots of enquiries recently about accounts and tax for Amazon sellers, so I’ve recorded a little video outlining our top tips if you are thinking about giving it a go yourself…

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